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Consumer Staples Sees Rising Momentum: 7 Stocks to Scoop Up
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The consumer staples sector has been on a growth trajectory since the beginning of the year, on the back of improved economic scenario buoyed by rising consumer confidence, which is a key determinant of the economy’s health. Although consumer confidence declined marginally in September due to hurricane Harvey and Irma’s impact in Texas and Florida, we believe the economic conditions are quite favorable and indicate that the economy will continue to grow in the near term.
The improving economy was also supported by labor market optimism and the recent gross domestic product (GDP) rate provided by the Commerce Department in consumer spending for the second quarter 2017. The commerce department stated that GDP rose 3.1% in the second quarter of 2017, the highest in two years. The recent tax cut proposal proposed by President Trump further instills confidence.
However, we understand that the U.S. economy is not fully immune to global uncertainties, which could limit growth potential. But the encouraging data as well as the new tax reforms reflects that the economy is in good shape and the spending power is likely to increase going forward. This is also well reflected in the three key U.S. indexes, which have closed in positive territory so far this year. The Dow Jones Industrial Average increased 13.0%. The S&P 500 rose 11.9%, while Nasdaq grew 20.3% on a year-to-date basis.
How Will Investors Gain From This Scenario?
At this moment, investors must be looking for those stocks that have been gaining momentum and are expected to outpace market’s performance in the coming months. Rightly, momentum investing can prove to be a winning strategy for investors seeking higher returns in a short span. We believe that the bullish projections present significant growth opportunity for momentum investors.
This strategy mainly suggests capturing profits by buying stocks that have witnessed an uptrend in the past few weeks or months. It is based on the idea that once a stock establishes a trend, it is more likely to continue in that direction than drift away from the trajectory.
Here we have highlighted few consumer staple stocks, which have outperformed the market’s performance so far this year. Further, these stocks carry a Momentum Score of either A or B along with a Zacks Rank #1 (Strong Buy) or #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
7 Prominent Picks
The Ridgefield, CT-based The Chefs' Warehouse, Inc. (CHEF - Free Report) , which is a distributor of specialty food products in the United States and Canada, is one such stock which is on the roll owing to strong growth prospects. The Zacks Rank #2 stock has performed impressively, with its shares moving up 25.3% on a year-to-date basis and against the industry’s decline of 10.2%. The company also carries a Momentum Score of B. The company posted an average positive earnings surprise of 0.08% in the trailing four quarters and has a long-term earnings growth rate of 19.0%.
Feltham, United Kingdom-based Nomad Foods Ltd. (NOMD - Free Report) is another key pick right now. The company manufactures and distributes frozen foods primarily in United Kingdom, Italy, Germany, Sweden, France and Norway. This Zacks Rank #1 stock surged 57.2% on a year-to-date basis against the industry’s decline of 10.2%.
The company also carries a Momentum Score of B. Nomad Foods posted an average positive earnings surprise of 8.75% in the trailing four quarters.
Investors can also count on cosmetics giant Estee Lauder Companies, Inc. (EL - Free Report) , which sports a Zacks Rank #1 and a Momentum Score of B. The company posted positive earnings surprises in the past four quarters, the average being 13.7%. It has a long-term earnings growth rate of 12.0%. The company has strong fundamentals that are reflected in the stock’s price movement, which surged 41.8% in comparison to industry’s gain of 6.4% on a year-to-date basis.
We recommend investing in Constellation Brands Inc. (STZ - Free Report) , which along with its subsidiaries, brews and markets beer, wine, and spirits in North America, Mexico, New Zealand and Italy. Constellation Brands presently carries a Zacks Rank #2 and Momentum Score of B. It delivered average positive earnings surprise of 11.7% over the trailing four quarters. The company’s shares have moved up 29.8% on a year-to-date basis, beating the industry’s gain of 20.7%.
We also suggest investing in Tyson Foods, Inc. (TSN - Free Report) , the world's largest fully-integrated producer, processor and marketer of chicken and poultry-based food products. Based in Springdale, AR, Tyson Foods currently flaunts a Zacks Rank #1 and a Momentum Score of B. Tyson Foods shares have moved up 15.7% on a year-to-date basis, higher than the industry’s gain of 13.8%. Earnings are expected to rise 16.0% and 5.0% for fiscal 2017 and fiscal 2018, respectively.
Tupperware Brands Corporation (TUP - Free Report) is a global direct seller of premium, innovative products across multiple brands and categories through an independent sales force. The company has rallied 17.8% year to date, in comparison with the industry, which gained of 0.6%. The Zacks Rank #2 stock also carries a Momentum Score of B. The company posted an average positive earnings surprise of 5.7% in the trailing four quarters and has a long-term earnings growth rate of 12.0%.
Investors can also count on London-based Unilever, Plc (UL - Free Report) , which operates in the fast-moving consumer goods industry worldwide. It currently carries a Zacks Rank #2 along with a Momentum Score B. It has a long-term earnings growth rate of 9.5%. Its share price movement shows that the stock has rallied 41.9% on a year-to-date basis, outperforming the industry, which increased 18.6%.
Bottom-Line
Momentum investing involves continuous appraisal of stocks which ensures that an investor picks a thriving one. The above-mentioned stocks are in the limelight due to impressive year-to-date returns as well as strong growth projections. We believe that they are great picks for a winning portfolio in the short term.
Can Hackers Put Money INTO Your Portfolio?
Earlier this month, credit bureau Equifax announced a massive data breach affecting 2 out of every 3 Americans. The cybersecurity industry is expanding quickly in response to this and similar events. But some stocks are better investments than others.
Zacks has just released Cybersecurity! An Investor’s Guide to help Zacks.com readers make the most of the $170 billion per year investment opportunity created by hackers and other threats. It reveals 4 stocks worth looking into right away.
Image: Bigstock
Consumer Staples Sees Rising Momentum: 7 Stocks to Scoop Up
The consumer staples sector has been on a growth trajectory since the beginning of the year, on the back of improved economic scenario buoyed by rising consumer confidence, which is a key determinant of the economy’s health. Although consumer confidence declined marginally in September due to hurricane Harvey and Irma’s impact in Texas and Florida, we believe the economic conditions are quite favorable and indicate that the economy will continue to grow in the near term.
The improving economy was also supported by labor market optimism and the recent gross domestic product (GDP) rate provided by the Commerce Department in consumer spending for the second quarter 2017. The commerce department stated that GDP rose 3.1% in the second quarter of 2017, the highest in two years. The recent tax cut proposal proposed by President Trump further instills confidence.
However, we understand that the U.S. economy is not fully immune to global uncertainties, which could limit growth potential. But the encouraging data as well as the new tax reforms reflects that the economy is in good shape and the spending power is likely to increase going forward. This is also well reflected in the three key U.S. indexes, which have closed in positive territory so far this year. The Dow Jones Industrial Average increased 13.0%. The S&P 500 rose 11.9%, while Nasdaq grew 20.3% on a year-to-date basis.
How Will Investors Gain From This Scenario?
At this moment, investors must be looking for those stocks that have been gaining momentum and are expected to outpace market’s performance in the coming months. Rightly, momentum investing can prove to be a winning strategy for investors seeking higher returns in a short span. We believe that the bullish projections present significant growth opportunity for momentum investors.
This strategy mainly suggests capturing profits by buying stocks that have witnessed an uptrend in the past few weeks or months. It is based on the idea that once a stock establishes a trend, it is more likely to continue in that direction than drift away from the trajectory.
Here we have highlighted few consumer staple stocks, which have outperformed the market’s performance so far this year. Further, these stocks carry a Momentum Score of either A or B along with a Zacks Rank #1 (Strong Buy) or #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
7 Prominent Picks
The Ridgefield, CT-based The Chefs' Warehouse, Inc. (CHEF - Free Report) , which is a distributor of specialty food products in the United States and Canada, is one such stock which is on the roll owing to strong growth prospects. The Zacks Rank #2 stock has performed impressively, with its shares moving up 25.3% on a year-to-date basis and against the industry’s decline of 10.2%. The company also carries a Momentum Score of B. The company posted an average positive earnings surprise of 0.08% in the trailing four quarters and has a long-term earnings growth rate of 19.0%.
Feltham, United Kingdom-based Nomad Foods Ltd. (NOMD - Free Report) is another key pick right now. The company manufactures and distributes frozen foods primarily in United Kingdom, Italy, Germany, Sweden, France and Norway. This Zacks Rank #1 stock surged 57.2% on a year-to-date basis against the industry’s decline of 10.2%.
The company also carries a Momentum Score of B. Nomad Foods posted an average positive earnings surprise of 8.75% in the trailing four quarters.
Investors can also count on cosmetics giant Estee Lauder Companies, Inc. (EL - Free Report) , which sports a Zacks Rank #1 and a Momentum Score of B. The company posted positive earnings surprises in the past four quarters, the average being 13.7%. It has a long-term earnings growth rate of 12.0%. The company has strong fundamentals that are reflected in the stock’s price movement, which surged 41.8% in comparison to industry’s gain of 6.4% on a year-to-date basis.
We recommend investing in Constellation Brands Inc. (STZ - Free Report) , which along with its subsidiaries, brews and markets beer, wine, and spirits in North America, Mexico, New Zealand and Italy. Constellation Brands presently carries a Zacks Rank #2 and Momentum Score of B. It delivered average positive earnings surprise of 11.7% over the trailing four quarters. The company’s shares have moved up 29.8% on a year-to-date basis, beating the industry’s gain of 20.7%.
We also suggest investing in Tyson Foods, Inc. (TSN - Free Report) , the world's largest fully-integrated producer, processor and marketer of chicken and poultry-based food products. Based in Springdale, AR, Tyson Foods currently flaunts a Zacks Rank #1 and a Momentum Score of B. Tyson Foods shares have moved up 15.7% on a year-to-date basis, higher than the industry’s gain of 13.8%. Earnings are expected to rise 16.0% and 5.0% for fiscal 2017 and fiscal 2018, respectively.
Tupperware Brands Corporation (TUP - Free Report) is a global direct seller of premium, innovative products across multiple brands and categories through an independent sales force. The company has rallied 17.8% year to date, in comparison with the industry, which gained of 0.6%. The Zacks Rank #2 stock also carries a Momentum Score of B. The company posted an average positive earnings surprise of 5.7% in the trailing four quarters and has a long-term earnings growth rate of 12.0%.
Investors can also count on London-based Unilever, Plc (UL - Free Report) , which operates in the fast-moving consumer goods industry worldwide. It currently carries a Zacks Rank #2 along with a Momentum Score B. It has a long-term earnings growth rate of 9.5%. Its share price movement shows that the stock has rallied 41.9% on a year-to-date basis, outperforming the industry, which increased 18.6%.
Bottom-Line
Momentum investing involves continuous appraisal of stocks which ensures that an investor picks a thriving one. The above-mentioned stocks are in the limelight due to impressive year-to-date returns as well as strong growth projections. We believe that they are great picks for a winning portfolio in the short term.
Can Hackers Put Money INTO Your Portfolio?
Earlier this month, credit bureau Equifax announced a massive data breach affecting 2 out of every 3 Americans. The cybersecurity industry is expanding quickly in response to this and similar events. But some stocks are better investments than others.
Zacks has just released Cybersecurity! An Investor’s Guide to help Zacks.com readers make the most of the $170 billion per year investment opportunity created by hackers and other threats. It reveals 4 stocks worth looking into right away.
Download the new report now>>